Trucking giant
XPO
reported better-than-expected third-quarter numbers amid a weak economy. The stock was rising early Monday.
XPO
(ticker: XPO) reported adjusted earnings per share of 88 cents from sales of $2 billion. Wall Street was looking for profit of 64 cents on sales of $1.9 billion, according to FactSet. A year ago, XPO reported earnings of 95 cents a share from sales of $1.9 billion.
XPO stock was up 3.3% to $69.54 in premarket tradng while
S&P 500
and
Dow Jones Industrial Average
futures were rising 0.6% and 0.5%, respectively.
It’s an earnings “beat,” and the early move was impressive. Coming into earnings, XPO stock has risen 119% over the past 12 months. The S&P 500 has gained about 6%. The Dow Jones Industrial Average was off about 1%.
“Our third-quarter results exceeded expectations, with solid growth in revenue and profitability, and strong forward momentum,” said CEO Mario Harik in a news release. “We delivered year-over-year revenue growth of 2%, and adjusted Ebitda growth of 6%, with [0.5 percentage points] of adjusted Ebitda margin expansion.”
Ebitda is short for earnings before interest, taxes, depreciation, and amortization. XPO reported third-quarter Ebitda of $278 million, up from $262 million reported a year ago. Wall Street was looking for $244 million.
The company’s less-than-truckload, or LTL, business was mostly responsible for the year-over-year gain with shipments per day rising 7.8% and tonnage per day up 3.1%. Pricing, excluding the impact of fuel, rose 6.8%.
LTL refers to shorter-haul trucking, typically for industrial customers. Truckload, or TL, shipping refers to, of course, trucks that are full and carrying mainly consumer items long distances.
LTL businesses have been helped by the bankruptcy and liquidation of LTL player Yellow, which was one of the largest LTL players in the U.S. That’s helped offset overall economic weakness. Last week,
Old Dominion Freight Line
(ODFL), an LTL leader, reported third-quarter earnings per share of $3.09. Wall Street was looking for $2.92. Pricing, excluding fuel impacts, rose 8.9% year over year.
Yellow has helped, but a growing economy would be better. The U.S. industrial economy has been contracting for 11 consecutive months.
XPO management hosts a conference call at 8:30 a.m. Eastern time to discuss results. Investors and analysts will be looking for clues that the industrial economy is turning around.
Write to Al Root at [email protected]
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